Cotton States Life Insurance Company Releases First-Quarter Earnings

ATLANTA, April 24 /PRNewswire Interactive News Release/ --
Cotton States Life Insurance Company (Nasdaq: CSLI) reports net earnings for
the first quarter of $1.0 million or $.16 per diluted share, compared to $1.5
million or $.24 per diluted share in 2000. Net earnings were down because of
increased mortality the Company experienced in its traditional lines during
the quarter. Total premiums during the first quarter were
$7.0 million, up 15 percent compared to the same period last year. In
addition, the Company posted a 36 percent jump in premium in its guaranteed
issue/simplified issue whole life products, as well as a 13 percent increase
in its traditional business premium.
According to the Company's president, chairman and chief executive
officer, J. Ridley Howard, "Our first-quarter performance illustrates that
we're continuing to improve. However, I am disappointed with the increased
mortality we experienced in our traditional business and its effect on the
Company's overall performance. Because we budget for mortality evenly over
the course of the year, quarterly fluctuations, even when they remain in the
normal range, can affect short-term earnings. With $5 billion of in-force
life insurance, a one percent variance in our projected mortality, which we
experienced this quarter, will occur periodically."
Cotton States Life Insurance Company offsets the effects of high mortality
with stop loss reinsurance, which is applied on an annual basis.
Howard continues, "While this quarter may be disappointing in the short
term, I am still confident that Cotton States' long-term performance will be
strong. The fact that we have posted nine consecutive years of record
earnings points to our strong fundamentals and our ability to stay on course."
In other business, the Company also announced today that the Board of
Directors declared a quarterly cash dividend of $.04 per share, payable on
July 2, 2001 to stockholders of record on June 11, 2001.
Cotton States Insurance is a group of companies that has been providing
quality insurance products to customers in the Southeast since 1941, with
products for auto, home and life. The Group's product portfolio is
complimented with specialty products that are marketed through its two
brokerage operations. The Cotton States Insurance Group includes Cotton
States Mutual Insurance Company, Shield Insurance Company and Cotton States
Life Insurance Company, including its two subsidiaries Cotton States Marketing
Resources and CSI Brokerage Services, Inc. Cotton States Life Insurance
Company is traded on The NASDAQ National Market under the symbol CSLI.
For additional information, contact Cotton States Insurance Company at
(770) 391-8786 or visit www.cottonstatesinsurance.com .
COTTON STATES LIFE INSURANCE COMPANY
Unaudited Consolidated Summary of Earnings
Three months ended
March 31,
2001 2000
Revenue:
Premiums $7,031,353 6,125,550
Investment income 2,548,392 2,401,626
Realized investment gains 8,985 116,976
Brokerage commissions 903,162 907,201
Total revenue 10,491,892 9,551,353
Benefits and expenses:
Benefits and claims 4,717,771 3,117,864
Interest credited 1,216,844 1,267,821
Amortization of policy
acquisition costs 927,794 852,764
Operating expenses 2,032,039 1,888,623
Total benefits and
expense 8,894,448 7,127,072
Income before income tax
expense 1,597,444 2,424,281
Income tax expense 576,390 900,666
Net income $1,021,054 1,523,615
Basic income per share of common
stock
Operating income $0.16 0.23
Net Income $0.16 0.24
Diluted income per share of common
stock
Operating income $0.16 0.23
Net income $0.16 0.24
Weighted average number of shares
used in computing income per
share
Basic 6,345,428 6,346,448
Diluted 6,519,876 6,467,157
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SOURCE Cotton States Life Insurance Company

ATLANTA, April 24 /PRNewswire Interactive News Release/ --
Cotton States Life Insurance Company (Nasdaq: CSLI) reports net earnings for
the first quarter of $1.0 million or $.16 per diluted share, compared to $1.5
million or $.24 per diluted share in 2000. Net earnings were down because of
increased mortality the Company experienced in its traditional lines during
the quarter. Total premiums during the first quarter were
$7.0 million, up 15 percent compared to the same period last year. In
addition, the Company posted a 36 percent jump in premium in its guaranteed
issue/simplified issue whole life products, as well as a 13 percent increase
in its traditional business premium.
According to the Company's president, chairman and chief executive
officer, J. Ridley Howard, "Our first-quarter performance illustrates that
we're continuing to improve. However, I am disappointed with the increased
mortality we experienced in our traditional business and its effect on the
Company's overall performance. Because we budget for mortality evenly over
the course of the year, quarterly fluctuations, even when they remain in the
normal range, can affect short-term earnings. With $5 billion of in-force
life insurance, a one percent variance in our projected mortality, which we
experienced this quarter, will occur periodically."
Cotton States Life Insurance Company offsets the effects of high mortality
with stop loss reinsurance, which is applied on an annual basis.
Howard continues, "While this quarter may be disappointing in the short
term, I am still confident that Cotton States' long-term performance will be
strong. The fact that we have posted nine consecutive years of record
earnings points to our strong fundamentals and our ability to stay on course."
In other business, the Company also announced today that the Board of
Directors declared a quarterly cash dividend of $.04 per share, payable on
July 2, 2001 to stockholders of record on June 11, 2001.
Cotton States Insurance is a group of companies that has been providing
quality insurance products to customers in the Southeast since 1941, with
products for auto, home and life. The Group's product portfolio is
complimented with specialty products that are marketed through its two
brokerage operations. The Cotton States Insurance Group includes Cotton
States Mutual Insurance Company, Shield Insurance Company and Cotton States
Life Insurance Company, including its two subsidiaries Cotton States Marketing
Resources and CSI Brokerage Services, Inc. Cotton States Life Insurance
Company is traded on The NASDAQ National Market under the symbol CSLI.
For additional information, contact Cotton States Insurance Company at
(770) 391-8786 or visit www.cottonstatesinsurance.com .
COTTON STATES LIFE INSURANCE COMPANY
Unaudited Consolidated Summary of Earnings
Three months ended
March 31,
2001 2000
Revenue:
Premiums $7,031,353 6,125,550
Investment income 2,548,392 2,401,626
Realized investment gains 8,985 116,976
Brokerage commissions 903,162 907,201
Total revenue 10,491,892 9,551,353
Benefits and expenses:
Benefits and claims 4,717,771 3,117,864
Interest credited 1,216,844 1,267,821
Amortization of policy
acquisition costs 927,794 852,764
Operating expenses 2,032,039 1,888,623
Total benefits and
expense 8,894,448 7,127,072
Income before income tax
expense 1,597,444 2,424,281
Income tax expense 576,390 900,666
Net income $1,021,054 1,523,615
Basic income per share of common
stock
Operating income $0.16 0.23
Net Income $0.16 0.24
Diluted income per share of common
stock
Operating income $0.16 0.23
Net income $0.16 0.24
Weighted average number of shares
used in computing income per
share
Basic 6,345,428 6,346,448
Diluted 6,519,876 6,467,157
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SOURCE Cotton States Life Insurance Company